After unsatisfactory Q3 2024 revenue results, Infineon has announced its layoffs plan as a part of its cost-saving measures to bring the company back on track to meet its goals. German semiconductor manufacturer Infineon Technologies recently announced the results of its performance in the third quarter of 2024, and the company claimed there was a “slight increase in revenue.” The increase in revenue indicated has more to do with a rise from the previous quarter, but the company revenue was down 9 percent year-on-year.
The reports also suggest the full-year forecast is going to fall within the predicted range that they have adjusted for, but it is evident that job cuts at Infineon are part of the strategy to meet targets.
Image: Infineon
Infineon Layoffs Plans to Affect Over, 1,400 Workers with More Positions Being Relocated
The Infineon job cuts have been confirmed by Reuters and it appears that the company is planning to eliminate around 1,400 jobs entirely. A further 1,400 positions will be relocated to countries with lower labor costs. Similar to reports of John Deere and Google relocating some roles to other regions, Infineon’s layoffs plan will not only reduce some of the roles but also rehire for positions that they don’t need to maintain within the country. The company currently employs 58,600 workers worldwide.
The reports also show that Infineon’s workforce reduction plans will largely affect workers from a plant in Regensburg in southern Germany but there are no details on whether it will be the only plant affected. Infineon’s layoffs plan follows the company-wide restructuring efforts that were announced earlier in May following their Q2 FY 2024 results.
Titled “Step Up,” the cost-saving measures outlined by Infineon include “various packages of measures focusing on the areas of manufacturing productivity, portfolio management, pricing quality, and operating cost optimization without compromising the Company’s innovative strength.” Infineon’s job cuts were not elaborated on in the document, but it’s clear that the company is moving forward with its layoffs.
Chipmaker Intel has also initiated an expansive plan to lay off a large number of workers in its efforts to reorganize the company and shift its business strategy. Many companies are working towards restructuring efforts, changing gears to steer the company towards where the demand is.
Infineon’s Job Relocation Strategy
According to a press release, the chipmaker has recently begun production at its largest chip plant in Kulim, Malaysia. Inaugurated on August 8, 2024, the company states that it will “become the world’s largest and most competitive 200-millimeter silicon carbide (SiC) power semiconductor fab.” This plant and other productions that the company operates across the globe will likely be the biggest benefactors of Infineon’s job relocation plans.
The company also began work on establishing a new plant in Dresden, Germany in May 2023. While the site is still under construction, when it is established, they will need to hire locally as well later down the line, which means job creation within Europe. The Infineon layoffs plan appears to be an immediate cost-saving measure that the company will make up for by rehiring later down the line. In the company’s own words, “The expansion will create approximately 1,000 highly qualified jobs” when manufacturing begins at the location in 2026.
Infineon Layoffs Plans Are Just One Example of the Layoff Trend That Is Making Workers Nervous
The Infineon job cuts are far from the only example of companies narrowing down their workforce. Some companies have been forced to turn to layoffs as a way to cut costs and eliminate overlapping roles, while others are letting go of workers in order to shift the company strategy—most often towards AI. A recent Express Employment Professionals-Harris Poll survey found that 31 percent of employed job seekers fear they will lose their jobs before they find another opportunity. The number was lower last year, standing at 28 percent in fall 2023 and 24 percent in spring 2023.
Out of the many results of the survey, one point stood out was that some of the unemployed workers had remained out of work for a long period, with 32 percent stating they had been unemployed for over two years. Of these, 34 percent had quit voluntarily, 19 percent were laid off, and 12 percent were fired. These were the most common reasons for being out of work.
Both voluntary and involuntary job loss can have long-term consequences and companies need to focus on retention more actively, just as employees need to focus on making their presence felt within an organization.
